In The News

The crowded field for the Democratic Party’s nomination for President in 2020 is leading to desperate actions by some of them to mislead voters in order to get votes. That’s the argument by Congressman Kevin Brady (R-TX) who is one of the most influential members of Congress and was an architect of the tax reform that has profoundly — and positively — impacted the economy. Sen. Kamala Harris (D-CA) recently stated in a tweet, “The average tax refund is down about $170 compared to last year. Let’s call the President’s tax cut what it is: a middle-class tax hike to line the pockets of already wealthy corporations and the 1%.” Brady has compared her statement to the type of thing Pinocchio would say and is not based on reality of truth.

In a statement to this media, Brady stated, “Boy, talk about a non sequitur that turns out to be nonsensical and misleading. Let’s take a look.”

Brady accurately notes that “the size of the tax refund has no bearing on whether a person’s taxes rose or fell. A person might end up giving less of their income to the IRS — and still end up with a smaller tax refund.” The failure to adjust the amount that is taken out in taxes doesn’t mean the recipient did not get a tax cut, it can be indicative of making an inaccurate adjustment.

“Change in refunds does not equate to change in tax liability, since withholding amounts were adjusted,” said Joseph Rosenberg, senior research associate at the nonpartisan Tax Policy Center.

Though few people look at this way, a smaller tax refund means you gave less of a loan to the U.S. government over the course of the year. Ideally, you should end up with no refund or tax dues.

When both the Joint Tax Committee and the Tax Policy Center looked at the impact of the tax bill, they concluded that in 2018, most people would see an overall reduction in taxes. The Tax Policy Center found that 80.4 percent of all taxpayers would have a tax cut, compared with about 5 percent experiencing a tax increase.

In the middle quintile, 91 percent would get a tax cut, averaging about $1,090, with 7.3 percent facing a tax increase averaging about $910.

But Sen. Harris presented these facts without nuance or qualification, making it appear as though the smaller tax refunds were evidence of a tax hike on the middle class. In reality, the size of a tax refund reflects nothing about the size of a tax cut or tax increase — and at least in 2018, the vast majority of middle-class Americans can expect to pay less in taxes as a result of the Trump tax law.

ICMYI: Yesterday, I joined Farmers for Free Trade at the #Rally4USMCA with my colleagues from both parties to urge Congress to pass the USMCA, ASAP!
https://www.youtube.com/watch?v=m7N2KjIQiJc&feature=youtu.be